Paul Chan expects deficit of around HK$100 bn for current fiscal year

Financial Secretary Paul Chan attended the Panel on Financial Affairs of the Legislative Council today (Dec. 2) to brief on the economic situation of Hong Kong and consult on the budget for the 2025-2026 fiscal year.

Chan stated that the forecast for the full-year real Gross Domestic Product (GDP) growth in 2024 is revised to 2.5%, and the prediction for the basic Consumer Price Index (CPI) inflation rate is adjusted downward to 1.1%. Additionally, taking into account bond issuance revenue and the repayment of maturing bonds, the preliminary estimate for the comprehensive deficit for the fiscal year 2024/25 is around HK$100 billion, significantly higher than the previously anticipated HK$48.1 billion announced at the end of February.

Chan mentioned that due to the continued trend of global inflation slowing down and the simultaneous escalation of geopolitical tensions and intensifying trade frictions, it is expected that the Hong Kong economy will continue to expand year-on-year in the third quarter, albeit at a slower pace.

He emphasized that facing an uncertain economic environment in the coming year, the government will continue to review income and expenditures, as well as the level of fiscal reserves while considering current and long-term societal needs. Measures and fiscal arrangements will be formulated accordingly to restore fiscal balance in the coming years.

Related News:

Mainland residents to enjoy easier access to HK and Macao with multi-entry visas

Hong Kong FinTech Week 2024 illuminates city's pathway to fintech innovation